Banks to use indelible ink to check repeated note exchange

Last updated on: November 15, 2016 16:39 IST

Grappling with unending queues and frayed tempers in banks and to check operation of syndicates, government on Tuesday decided to introduce a system of marking customers exchanging defunct currency notes with indelible ink while monitoring suspicious deposits in Jan Dhan accounts.

After a review meeting taken by Prime Minister Narendra Modi on Monday night to discuss the situation, the government has set-up a high-powered group under the cabinet secretary to monitor supply of essential goods in the wake of disruption of trade due to shortage of currency notes.

Besides, a task force has been constituted to monitor circulation of fake currency notes in vulnerable areas and to keep a watch on black money being deposited in the system.

“It has come to notice of the government that in many places the same people are coming back again and again and we have also received reports that certain unscrupulous elements who are trying to convert black money into white have organised groups of innocent people and are sending them from one branch to another branch to exchange notes and get Rs 4,500,” Economic Affairs Secretary Shaktikanta Das told reporters.

“As a result what is happening is that the benefit of withdrawal of cash is getting restricted to smaller number of people...to prevent such kind of misuse, the branches of banks to take recourse to use of indelible ink marks for disbursement of cash,” he said.

This would prevent certain syndicates and certain kind of people coming to branch again and again, he said.

Das said the government is keeping a close watch on deposits in Jan Dhan account as in many cases such account are being misused for parking black money.

“Any legitimate deposit in Jan Dhan account, the person concerned would not be put to any inconvenience. I take this opportunity to appeal all the Jan Dhan account holders not to allow themselves to be used by other people for putting (illegitimate) money in their accounts,” he said.

There are reports that many Jan Dhan accounts are getting deposit of Rs 49,000. The deposit limit of Jan Dhan account is Rs 50,000.

With regard to indelible ink mark, Das said the operational guidelines would be decided by the banks.

On augmenting delivery channels, Das said cash availability with the District Central Cooperative Banks and 1.3 lakh post offices has been enhanced which should be able to meet the requirements of rural population.

Besides, the religious organisation or temple trust are encouraged to deposit smaller denomination of notes which usually come to them, he said, adding that it will help increase supply of lower denomination currency into the market.

To promote electronic payments, he said, the government has decided to set up a technology team to popularise e-wallet.

A task force has also been set up that will draw a plan of action for shifting of the old notes and storing of the old notes in other place so that banks and post offices continue to get new notes.

Asking people not to fall prey to rumours like shortage of salt and bankers going on strike, Das said the government will ensure adequate availability of cash as well as essential commodities.

“The supply of essential commodities is very closely monitored. The Cabinet Secretary is heading a group of secretaries and other senior official to monitor movement and supply of essential commodities across the country,” Das said.

The cabinet secretary will also head a coordination group that will include senior representatives of the banks to monitors various decision taken by the government to ease currency availability in the market, he added.

Das said Micro ATMs are being installed at banks which would be functional from Tuesday and the major cities will have the indelible ink available from Tuesday itself.

The operating instruction will be given to banks for the mark, he added.

Assuring that there is enough cash available, Das said there is no reason for panic and the government would continue to monitor the situation, taking all steps required to ease the pressure of public will be taken.

He said the primary objective of the government is to improve convenience to the public.

“The situation was reviewed again last night by the prime minister with the (Union) finance minister and the minister of coal and power. The cabinet secretary, secretaries from finance ministry, principal secretary and additional principal secretary, Prime Minister’s Office and other officials from PMO were also present,” he said.

To activate Banking Correspondent, he said, the ministry is in touch with the state government and chief secretaries.

He expressed hope that the situation would ease out in the next few days.

Meanwhile, The Mysore Paints and Varnish Limited, the company which provides indelible ink to the Election Commission since 1962 to mark voters, has been asked to keep its stocks ready.